Dynamic Managerial Capabilities Research Articles

Exploring The Antecedents of Digital Orientation: The Role of Dynamic Managerial Capabilities

A digital orientation increases firm performance and builds the foundation for a successful digital transformation. However, little is known on why some firms dedicate more time and resources on digitalization initiatives than other firms do. In our study, we empirically provide first determinants for the novel construct of digital orientation by utilizing a panel dataset with 3,595 firm-year observations between 2006 and 2018 on large firms in the United States. We model R&D search intensity as a dynamic managerial capability and reveal that it is positively related to a digital orientation. We demonstrate that competitive intensity as well as the presence of a digital executive interact with this relationship. We also find a three-way interaction between CEO age, digital executive presence, R&D search intensity and digital orientation, adding to the literature on top management team member interrelations in strategic decisions. Taken together, our study advances literature on how dynamic managerial capabilities unfold in the R&D search and digital strategy context. Our findings also provide advice for practitioners.

Dynamic Managerial Capability and the Longevity of a Family Business

This study is motivated by evidence that entrepreneur capacity influence business opportunities detection and a manager's capability to manage a company's resources by adapting business to changes in sector, economy, and market. Strategy studies also argue that we should look at individuals and not only at organizational strategy, seeking to broaden the understanding of the phenomenon of strategic management. This way, owner´s agency, especially concerning family businesses in a developing country's economic environment, can be a differential regarding business longevity. In this context, this study aims to identify What is the participation of the managerial capability for the longevity of a family business operating in the Brazilian industrial market for 30 years. The managerial capability are based on three main management factors: human capital, social capital, and cognition (Adner & Helfat, 2003). To develop this study, a qualitative case study was conducted with a family firm active in the hospital products sector. The dynamic aspect of the combination, transfer and recombination of resources is dealt with by the analysis of the company's trajectory throughout its existence. The results point that the individual capabilities of the members´ family orchestrate the business strategy in a complementary manner composing the firm managerial capability.

Dynamic managerial capabilities and entrant survival: insights from the solar PV industry life cycle

This study identifies the dynamic management capabilities which command firms’ survival in their entries into both new and uncertain industries at the maturity stage of an industry lifecycle. Through quantitative data analysis, we reveal that the effect of these capabilities is asymmetrical: whilst dynamic management capabilities (reflected by prior industry experience of executive management) do not assist in entry during the evolution stage, more so, the length of prior industry experience available to entrants at a time of entry correlates to post-entry mortality rates, these capabilities are important to succeed in market entry during the maturity stage of an ILC. Our analysis comprises data from the energy sector during the evolution and maturity stages of solar photovoltaic industry. The empirical setting of the energy sector over the last three decades provides a fresh an ideal domain in which to test the success of entry timing decisions at various stage of an industry lifecycle in uncertain industry. Our results overwhelmingly support our central thesis regarding the specific impact of dynamic management capabilities on post-entry survival. We test and find a partial support for our hypotheses by analysing the acquisitions and joint ventures of 149 energy firms in years between 1997 and 2016. These findings have important implications for the literature on entry timing and dynamic management capabilities.

Managerial Internal Social Capital, Environmental Dynamism, and Business Model Design

Drawing on business model and dynamic managerial capability literature, this paper explores how managerial internal social capital impacts business model design under environmental dynamism. Based ...

Integrative Managerial Capabilities; a New Managerial Mechanism to Achieve a Firm Competitive Response

Aims: Companies that should operate in competitive business environments must be able to sustain competitive responses over time. Making such responses, however, typically necessitates the firm's managerial capacity to constantly integrate its properties, ensuring that they are all matched with changing market needs. Based on the literature of Knowledge Management and Dynamic managerial capabilities, this paper contributes to our understanding by developing an Integrative Managerial Capabilities concept, which refers to “managers’ ability to orchestrate a firm resource base through the processes of search, selection, configuration and deployment to achieve and sustain a firm competitive response”. Integration mechanisms are described which provide a key managerial capability. According to the literature on strategic management, limited past studies research has focused on facets of the firm's integrative capabilities. In the current literature, there is a notable lack of comprehensive insight into how companies actually orchestrate "integrate" resources and principal to achieve sustained success in complex environments.
 Method/Approach: To answer the research questions, the study employed two data collection strategies: qualitative interviews; “semi-structured interviews”, and an open-ended survey, “online questionnaire”.
 Findings: The relationship among managerial integrative capabilities and various levels of a firm's systemic structure, in particular, has never been clearly explained. The research concludes that the incorporation process is highly relevant to the case study examples, and that middle management can be seen to have a substantial effect on company change as a result of top and lower-level management integration.
 Originality: this study argued that better and faster integration between the three main integrative mechanisms “search and selection, configuration and deployment” should itself be a potential source of sustained competitive respond; and that usually that integration will need to traverse “high, middle, and low managerial levels” of management structure.
 Implications: we recommend that future research into managerial integration processes, such as particular types of transition programs, be undertaken.

Do All Roads Lead to Innovativeness? A Study of Public Sector Organizations’ Innovation Capabilities

Although much has been written about public sector innovation in the last two decades, we still do not fully understand how public sector organizations become innovative. Therefore, this study inductively explored how four Norwegian municipalities developed innovation capabilities. I found that public sector organizations develop two forms of innovation capability in a path-dependent manner: low-routinized innovation capability and highly routinized innovation capability. In the former, dynamic managerial capabilities in the form of individuals’ entrepreneurial and leadership skills comprise the source of innovation capability. In contrast, in the latter, innovation capability emerges from dynamic organizational capabilities, that is, a set of innovation-stimulating routines, processes, tools, and structures. Notably, I found that regardless of the form of innovation capability, both spur the continuous development and implementation of various radical and incremental public sector innovations. Based on these findings, this study offers several contributions to the literature on public sector innovation and to the dynamic capabilities research agenda.

The contribution of board experience to opportunity development in high-tech ventures

This study investigates the board of directors’ contribution to opportunity development in high-tech ventures. Based on the dynamic managerial capabilities perspective, we argue that more experienced boards will contribute more to opportunity development. Furthermore, building on the attention-based view, we argue that this effect will be moderated by structural and situational factors that affect board members’ attention to the venture’s opportunity development process. Using hand-collected data on 179 high-tech ventures in Belgium, we find that board experience has a stronger relationship with the board’s contribution to opportunity development when board size decreases, when board tenure increases and when the venture underperforms. These findings offer a contribution to the literature on opportunity development in new ventures and to research on the boards of directors’ role in new ventures. They also have important implications for entrepreneurs who are trying to develop opportunities and their stakeholders. Plain English summary While experienced board members have the potential to contribute to opportunity development in high-tech ventures, they often refrain from leveraging this experience due to the structure of the board and the situation of the venture. When high-tech ventures try to develop new opportunities, they mostly rely on the experience of the top management team. As this could limit the range of opportunities they see, bringing in experienced board members may seem a fruitful way of getting new information and a broader perspective. This study indeed shows that, in the context of high-tech ventures, more experienced boards can contribute more to opportunity development. However, even if board members have relevant experience, they are not always motivated to use this experience to the benefit of the venture. In fact, they are less likely to leverage their experience when boards are bigger in size, when board members have spent less time sitting together on the board, and when the venture performs better. The implication of this study is that high-tech ventures should be aware that board members can potentially contribute to opportunity development, but that their actual contribution depends on structural and situational factors that direct board members’ attention to opportunity development.

Dynamic managerial capabilities, organisational capacity for change and organisational performance: the moderating effect of attitude towards change in a public service organisation

PurposeThe aim of this study is to explore dynamic managerial capabilities (DMCs) and their effect on public organisational performance. While the previous research has focused on how leadership style impacts on organisational performance, the authors have investigated how the dynamic managerial capabilities of middle managers and their organisational capacity for change as well as their attitude towards the change are linked to organisational performance.Design/methodology/approachThe dataset was gathered during the field research carried out in a large public Indonesian government institution. In total, 313 managers and their direct followers participated in this study. The authors have employed structural equation modelling to test the hypotheses.FindingsThe results of this study demonstrate the role of the dynamic capabilities of the middle managers associated with organisational performance. The results show that dynamic managerial capabilities and organisational performance are mediated by the organisational capacity for change.Practical implicationsMiddle managers should equip and develop their capabilities in order to embrace change in the organisation through the communication between the different staff levels, uniting the vision and mission with the organisational members. Further, the organisation should empower the role of the middle managers by increasing their authority and participation in the policy-making that is part of the change process. In addition, the workplace could implement interventions to optimise the dynamic managerial capabilities held by the middle manager and employees through assessments and mentoring. Finally, particular training programmes could be implemented to boost the employees' skills and flexibility, thereby keeping them agile in the context of the changes in the work environment.Originality/valueThe role of the dynamic managerial capabilities of the middle manager is a prominent factor when facilitating a high level of organisational performance in a public organisation. However, the role of dynamic managerial capabilities does not have a direct effect on organisational performance if the organisation does not have the capacity to change, particularly in the Indonesian context.

Merger & Acquisitions (M&As) as an important strategic vehicle in business: Thematic areas, research avenues & possible suggestions

Merger and acquisition (M&A) have become a foremost strategic alliance for business, product and geographic tactics in global market. Using meta-literature review, we conduct a synthesis analysis on M&A to assess motives, methods, financing sources, announcement effects, cross-border competitions, success-failure, valuation issues, and business strategies. We review 155 recent and relevant papers preferably published during 2015–2020 in 58 leading business journals of ISI-WOS through bibliometric study coupled with content analysis. We show influential aspects of journals, authors, articles, topics, thematic areas, findings, contributions, research gaps, suggestions, and current landscape of M&A. We recommend that firms having constraints might consolidate energies by resorting to productive M&A. Finally, we identify future research questions to extend the research avenues. Overall, this academic novelty significantly contributes to enhancing our knowledge in dynamic managerial capabilities, outlines further study agenda, and eventually provides business strategy & investment implications in global context.

Unbundling and Managing Uncertainty Surrounding Emerging Technologies

Emerging technologies, while offering enormous potential for economic growth, carry a high degree of uncertainty regarding whether and when that potential may be realized. How can firms evaluate the uncertainty surrounding an emerging technology? To address this question, we offer a structured approach that unbundles the uncertainty surrounding emerging technologies, incorporating both supply- and demand-side factors. These include the focal technology itself, the potential market applications, the users adopting the technology, the ecosystem of activities that support the technology’s value creation, and the business model with which the technology is being commercialized. We further consider that the uncertainty surrounding each of these sources may not be resolved in a vacuum, but, rather, that it may interact with other sources of uncertainty in a pooled, sequential, or reciprocal way. Such a structured approach of evaluating uncertainty can help firms and managers in terms of the cognitive processes and the managerial practices and provide microfoundations for dynamic managerial capabilities. We illustrate the applicability of the framework for two emerging technologies—gene therapy and autonomous vehicles—and how the framework can be integrated with prominent managerial practices for managing uncertainty.

Migrant human and political capitals value in entrepreneur enterprise performance. A comparative study of four emerging markets

This paper investigates the impact of human and political capitals of entrepreneurs on enterprise performance in four emerging nations.The rent generation potential of these capitals is a well established fact, however, much less is known concerning the contingent nature of their value creation prowess. In this work, we draw on institutional theory and dynamic managerial capabilities perspective to examine the interactive effect of country of origin economic developement level and the international experience of entrepreurs, on the capitals, with respect to a set of financial indicators. Employing a quantitative methodology, our findings reveal that the relationship between the capitals and enterprise performance are indeeed contingent with the capitals of home-grown entrepreneurs, rather than those of returnee migrant entrepreneurs, exhibiting a greater propensity to influence enterprise performance. We conclude with implications for theory and practice.

Role of information technology in enabling managerial dynamic capabilities

PurposeThe purpose of this conceptual paper is to explicate the role played by information technology (IT) in enabling managerial dynamic capabilities. By doing so, this paper seeks to address a critical theoretical gap regarding IT’s role in enabling dynamic capabilities (DCs). DCs are knowledge-intensive and information-intensive processes and play a crucial role in facilitating strategic renewal of firms operating in volatile, uncertain, complex and ambiguous business environments. Although managers play a central role in the DCs framework, extant research has only focused on the role of IT in enabling firm-level and process-level DCs.Design/methodology/approachThis conceptual paper uses the literatures on dynamic managerial capabilities, individual-level information system use, social capital, human capital, managerial cognition and technology-enabled learning to build propositions that link managerial IT use with the enablement of dynamic managerial capabilities.FindingsThis paper introduces a new construct called individual IT leveraging capability (IILC) and provides theoretically grounded arguments that link IILC with managerial social capital, managerial cognition and managerial human capital. It also explicates the relationships between managerial social capital, managerial cognition and managerial human capital and the dynamic managerial capabilities of sensing, seizing and reconfiguring.Research limitations/implicationsThe establishment of the linkage between IT and dynamic managerial capabilities extends the literature on the business value of IT. This work also adds to the literature on dynamic managerial capabilities by providing a theoretically grounded argument that IT can act as an antecedent of such capabilities.Originality/valueTo the best of the authors’ knowledge, this paper is arguably the first to theorize the role of IT in enabling managerial DC and thus addresses a critical gap in academic research literature.

Dynamic managerial capabilities and sustainable market competencies: role of organisational climate

Purpose Managerial capabilities are one of the primary resources in every organisation that have peculiar strategic objectives to fulfil. The purpose of this paper is an effort to dig out how managerial cognition, human capital and social capital as underpinnings of dynamic managerial capabilities (both separate and composite) affect sustainable strategic market creation (SMC) in nascent industries. Moreover, this study unfolds the role of dynamic managerial capabilities (sensing, seizing and reconfiguring) as a key mechanism through which these underpinnings lead to SMC. Design/methodology/approach For this purpose, a sample of 497 respondents was collected from top and middle-level managers of insurance companies in Pakistan. Structural equation modelling was used to test a set of direct, indirect and moderation hypotheses. Findings Findings revealed that DMC underpinnings have a direct positive impact on marketing and research and development competence dimensions of SMC. Results also confirmed significant mediation paths and substantial moderation of aforementioned organisational climate factors between dynamic managerial capabilities (DMC) and its underpinnings. Originality/value It offers a first examination of the possible moderation impact of innovation, flexibility and outward focus between DMC and its underpinnings as essential organisational climate factors.

Antecedents and consequences of market orientation in international B2B market: role of export assistance as a moderator

PurposeThe significance of market orientation (MO) in industrial marketing literature is immense. Separately, the role of dynamic managerial capability (DMC) as an individual-level capability has been found to be beneficial to business-to-business (B2B) transactions. However, the assessments of DMC as the antecedent to complement MO in achieving firm performance are rare. To address this knowledge gap, this study builds upon a research framework on the DMC theory and MO literature. Additionally, this study aims to investigate how export assistance avails MO-firm performance relationship and assists entrepreneurs to thrive in the international market.Design/methodology/approachThe research was conducted among the entrepreneurial export manufacturing firms in the apparel industry in Bangladesh. Structural equation modelling was used to investigate the hypothesized relationship among 329 firms.FindingsTwo attributes of DMC, namely, managerial social capital and managerial cognition of entrepreneurs improve the MO process of export manufacturing firms. MO mediates the relationship between DMC and firm performance. Additionally, export assistance positively moderates the relationship between MO and the financial performance of the firm.Originality/valueMO requires complementary capabilities to realize the value of it efficiently. This study strongly advocates entrepreneurs to nurture DMC to leverage MO and capitalize on emerging opportunities by productively using export assistance. Firms in the emerging economies often suffer from resource-scarcity and export assistance mitigates barriers to expand international operations and yield financial liberty to the firms operating in the international B2B market.

DYNAMIC MANAGERIAL CAPABILITIES AS ANTECEDENT OF CORPORATE ENTREPRENEURSHIP: A CONCEPTUAL MODEL

Current studies on Corporate Entrepreneurship (CE) present organisational boundaries, discretionary time, rewards/reinforcements, work discretion and management support as antecedents of CE. This ignores the fact that all these variables are a managerial function in organisations. Furthermore, considering these variables at the same predictor level as management support, has contributed to entrepreneurship coordination challenges for organisations. To address this predicament through the lens of dynamic capabilities, we submit a conceptual model that considers dynamic managerial capabilities as antecedents of CE.

The Wind of Change: A Dynamic Managerial Capabilities Perspective on the Role of Marketing Managers as Strategic Change Agents

The Wind of Change: A Dynamic Managerial Capabilities Perspective on the Role of Marketing Managers as Strategic Change Agents

Managerial capabilities and firms' sustainable performance: Evidence from Chinese manufacturing small and medium-sized enterprises

This research seeks to address small and medium-sized enterprises (SMEs)’ performance problems by linking dynamic managerial capabilities to firm performance. In today’s dynamic market environment, it is vitally important for managers/owners of SMEs to possess dynamic capabilities. This study limited its focus to three managerial capabilities namely networking, sensing, and innovation with the moderating role of market dynamism. The data collection process and analysis provided findings that revealed that Chinese SME managers/owners effectively employ managerial capabilities in managing their firms. The hypotheses tests resulted in significant positive relationship between the main variables and performance. The moderating variable, however, had a significant effect only on moderating the relationship between sensing capabilities and performance. The findings from this study suggest that SMEs need to improve their knowledge and application of managerial capabilities in transforming their business performance thereby contributing to the national economy. This study contributes to the dynamic capabilities’ literature by adding to the existing research on the subject. It also provides an understanding of how dynamic capabilities are deployed to build up a solid and sustainable firm performance that resists the waves of market upheavals and it is expected to greatly benefit theory, policy and practice.

Bia Brazil or International Bia Brazil

This teaching case aims to analyse the impact of dynamic managerial capabilities and their relationship with the entrepreneurial orientation in the internationalisation process of a small family bu...

Business-to-Business Selling in Transition: A Digital Dynamic Managerial Capability Framework

Abstract Despite an increased understanding of changing customer behavior and requirements for more digitalized selling opportunities, the use of new advanced technologies (such as artificial intelligence, machine learning, and robotic process automation) in business-to-business (B2B) selling is still in an early stage among Finnish small- and medium-sized enterprises (SMEs). Furthermore, the increased complexity of expanding relationships and rapidly evolving technologies to be managed in the ecosystem era challenges many SMEs. In order to assist managers in these enterprises to enact a digital transformation and to survive in the ecosystem era, this article draws analytical insights from various streams of literature (B2B selling and sales management, dynamic managerial capabilities, digital transformation, and ecosystems) and establishes a new understanding of the dynamic capabilities of managers in relation to the digital transformation occurring around B2B-selling processes. The article contributes to the sales management literature by developing (1) a framework of digital dynamic managerial capabilities as a means to address the current digital transformation in B2B selling, and (2) a research agenda for further study in the field of B2B selling. With regard to managerial implications, the article offers insights for managers on how to identify and develop their dynamic capabilities needed for strategic digital transformation.

Dynamic managerial capabilities in micro-enterprises: Stability, vulnerability and the role of managerial time allocation

This article analyses how dynamic capabilities are enacted in micro-enterprises and what role different parties and managerial time allocation play in this enactment. Drawing upon three in-depth case studies of micro-enterprises, we make three theoretical contributions. First, after arguing that micro-enterprises are likely to enact individual- or group-level dynamic managerial capabilities rather than organisation-level dynamic capabilities, we counter Teece’s warnings about the vulnerable nature of dynamic managerial capabilities. Second, we identify that how managers allocate their own time, is a core micro-foundation of dynamic managerial capabilities; we illustrate that failure to allocate time to capability enactment can lead to capability vulnerability. Finally, we introduce the notion of ‘self-damaging dynamic managerial capabilities’ – these being capabilities that damage established micro-foundations.